How extortion is hobbling broadband roll-out

Laying fibre-optic cabling isn’t normally considered a dangerous job – difficult, time consuming and labour intensive, yes, but not physically dangerous. Except in Johannesburg, where gangs of thugs have begun threatening contractors with guns.

Why on earth are these gangs terrorising contractors? It’s not for the fibre itself. Unlike copper cables, which are routinely stolen for their scrap value, glass filament has no resale market. No, This is essentially an extortion racket: pay us money or you and your workers start getting shot.

As TechCentral reported last week, contractors laying fibre in Sedibeng, a municipality in south Gauteng, were literally chased off-site by armed gangs after they refused to pay protection money.

In the report, other companies alleged that ward councillors in Soweto were routinely demanding that they employ local workers on all their projects. Since many projects span several wards, companies were forced to keep hiring new locals for each leg of the project. These workers often refused to work at a reasonable pace or simply quit without notice, stealing expensive equipment when they left.

Companies were only willing to talk to TechCentral about the issue on condition of anonymity, saying they feared reprisals by criminals or ward councillors.

The managing director of one of the affected companies explained the broader impact to TechCentral: “I’ve just turned down 12km of work in Soweto, a R3.6-million project. We were running at a loss and the guys’ lives were at risk. This whole situation led me to retrenching staff last year. Subcontractors are running at a loss and closing their doors because of the short-sightedness of ward councillors who are doing this just to get more votes.”

Fibre trench (image from Flashsa)

But the impact goes far deeper than just a few hundred jobs in the telecommunications industry. These thugs and corrupt local politicians are holding back the progress of South Africa’s whole broadband industry. And broadband isn’t just a toy for the rich – it’s becoming vital to economic participation at every level.

By hobbling the rollout of broadband to areas such as Soweto and Sedibeng, these gangsters are directly harming their own communities and the national economy. Studies in other developing economies showed that readily available broadband boosted job creation, drove economic growth and empowered the poor to rise out of poverty.

A report by Unesco spelled out these benefits: a 10 percentage-point rise in broadband penetration added 1.38-percentage points to economic growth. A study in Brazil reported broadband added up to 1.4% to the employment growth rate. Another study in the Philippines found that broadband accounted for “7.3% of all economic growth in the country” in the decade from 2000 to 2010.

Broadband has wider societal benefits too. A slew of case studies from around the world show that broadband can improve education, empower marginalised people such as young women and girls, and give people in rural areas access to vital health information.

In short, broadband isn’t optional any more and the real issue isn’t a few contractors whining about being shaken down. This is Africa at its most nihilistic and self-defeating – local heavies holding up progress in order to extract petty payoffs. We need to treat these criminals with the severity that this economic vandalism demands.

Imagine the uproar by locals if the same logic were applied to the rollout of electricity or sewerage? We need to start thinking of broadband as just as vital as those services. These thugs and corrupt ward councillors are not just stealing money, they are stealing our future.